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Obama stays stern with North Korea, and GOP wants to send message with Sotomayor vote. Plus: A 'bad bank' scheme for Fannie and Freddie?

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White House: Obama Tells North Korea Not To Expect A Thaw

• "A day after former President Bill Clinton's flight into North Korea to win the freedom of two American journalists, the Obama administration moved Wednesday to send a stern message to the North Korean government: nothing has changed," the New York Times reports. "While President Obama celebrated the emotional reunion of the journalists, Laura Ling and Euna Lee, with their families, he said Mr. Clinton's 'humanitarian mission' did not ease the demands of the United States and many allies that North Korea alter its behavior if it wants to escape its isolation."

• "Promising new jobs and money," Obama "on Wednesday told a hurting Midwestern region that its recovery will be like America's: tough but certain," AP reports. "Obama's second visit as president to a northern Indiana area mired in unemployment reflected political reality. People appreciate hope and the presence of the president, but they want jobs. So Obama came bearing all of those in what amounted to a national economic pep talk."

• Office of Management and Budget Director Peter Orszag and White House science adviser John Holdren "have asked agencies to build on federal science and technology priorities reflected in the stimulus package and the FY10 budget in their planning for the next fiscal year," CongressDailyAM(subscription) reports.

Congress: Senate Expected To Pass 'Cash For Clunkers' Extension

• "The Senate is poised to add $2 billion to the popular 'cash-for-clunkers' program after lawmakers agreed to vote on the government car incentives and give shoppers until Labor Day to visit their local dealerships and make a deal," AP reports. "Administration officials have estimated the tripling of the $1 billion program could fund an additional 500,000 new car sales."

• "Young adults, hit disproportionately hard in the current recession, are asking Congress for targeted aid to help them recover," the Wall Street Journal(subscription) reports. "A coalition called 80 Million Strong for Young American Jobs" is "pushing a legislative agenda devoted to young Americans, partly on the argument that, without help, the group will be a continuing drag on the economy."

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• "Congress's normally lax August recess is shaping up to be a tumultuous time this year as a deluge of protesters, fueled by political parties and interest groups, greet lawmakers in their home states," The Hill reports.

Politics: GOP Seeks To Discourage Future Liberal Appointees

• "Republicans are expected to vote overwhelmingly against Judge Sonia Sotomayor in the Supreme Court confirmation vote set for" today "with an eye toward a potential next pick from" Obama, "according to party lawmakers and strategists," the Wall Street Journal reports. "Republicans say the show of party unity will discourage Mr. Obama from choosing a more liberal candidate in future picks and that the arguments they developed against Judge Sotomayor set a precedent for rejecting what they see as 'activist' judges."

• "House Oversight and Government Reform ranking member Darrell Issa (R-Calif.) may be one of the majority's chief tormentors and an apt political bomb thrower, but the person Democrats have to thank for Issa's persistence is none other than Rep. Henry Waxman (D-Calif.)," Roll Call(subscription) reports. "Since taking the minority post in January, Issa has done everything in his power to mimic Waxman's approach, with the Obama administration as his target."

• "House Speaker Nancy Pelosi," D-Calif., "moves in a rarefied world of high society and high-level politics -- and nothing underscores that fact quite like her plans for the August recess," Politico reports. "Pelosi will spend next weekend quietly tending to top party donors and political allies at a series of private events in Northern California."

• "Republicans and Democrats might still be looking for strong candidates in some of the marquee 2010 Senate races, but in Ohio, both parties are running so aggressively to replace retiring GOP Sen. George Voinovich that it seems like the general election is coming up in 15 days rather than 15 months," CongressDailyAM(subscription) reports. "Democratic Lt. Gov. Lee Fisher and former GOP Rep. Rob Portman are on the attack, long before most voters are tuning in and before they've even had a chance to define themselves."

Health Care: Details Of Senate Finance Proposals Emerge

• "Senate negotiators are inching toward bipartisan agreement on a health-care plan that seeks middle ground on some of the thorniest issues facing Congress, offering the fragile outlines of a legislative consensus even as the political battle over reform intensifies outside Washington," the Washington Post reports.

• "Center on Budget and Policy Priorities Executive Director Robert Greenstein said Wednesday that his organization has confirmed with multiple sources that the Senate Finance Committee's healthcare bill will require employers that don't provide insurance to pay the average subsidy cost per person for employees who use a health insurance exchange and qualify for a subsidy because their family income is below 300 percent of poverty," CongressDailyAM(subscription) reports.

• "Senate Democrats have identified a healthcare reform talking point they believe is a winner: No tax increases. After a two-hour meeting Wednesday, Democrats made a special point to emphasize they will not raise taxes on any individuals, unlike House Democrats," The Hill reports. "'There's been a lot of talk about the House plan; it has tax increases as pay-fors. We really don't,' said Sen. Kent Conrad (D-N.D.)."

Economy: Administration Weighs Overhaul For Fannie And Freddie

• "The Obama administration is considering an overhaul of Fannie Mae and Freddie Mac that would strip the mortgage finance giants of hundreds of billions of dollars in troubled loans and create a new structure to support the home-loan market, government officials said," the Washington Post reports. "The bad debts the firms own would be placed in new government-backed financial institutions -- so-called bad banks -- that would take responsibility for collecting as much of the outstanding balance as possible."

• "Federal Reserve officials could move in the coming weeks to extend the life of a program aimed at reviving consumer and business lending markets," the Wall Street Journal reports. The Term Asset-Backed-Securities Loan Facility "will be one of several issues on the table at the Fed's next policy meeting Aug. 11 and 12, when Fed governors meet with presidents of the Fed's 12 regional banks to set a path for interest rates."

• "Senior officials at the Federal Reserve, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency... told the Senate banking committee on Tuesday that" the Obama administration's proposal to transfer some of their authority to a new consumer protection agency "would never be as effective as they have been," the New York Times reports. "But instead of modifying or withdrawing the plan, the Treasury secretary, Timothy F. Geithner, has taken the regulators to task."

World: Ahmadinajad Sworn In For Second Term

• "With his adversaries boycotting the ceremony and a vast deployment of police officers standing guard outside, Mahmoud Ahmadinejad was sworn into office on Wednesday for a second term as president, almost two months after an election that divided the nation and set off Iran's deepest crisis since the Islamic Revolution 30 years ago," the New York Times reports.

• "The new head of NATO paid a surprise visit to Afghanistan on Wednesday to reinforce his message that the war against the Taliban and Al Qaeda remains the alliance's top priority," the Los Angeles Times reports. "But whether Anders Fogh Rasmussen can persuade NATO countries to commit more resources to a war that is becoming more deadly on the ground and less popular at home remains to be seen."

• "US Secretary of State Hillary Clinton is due to hold talks with Somali President Sheikh Sharif Sheikh Ahmed in Kenya's capital, Nairobi," BBC News reports. "She is expected to endorse Somalia's beleaguered transitional government amid fears the country is becoming a haven for Islamist militants."

• "The U.S. government must fundamentally redefine the struggle against terrorism, replacing the 'war on terror' with a campaign combining all facets of national power to defeat the enemy, John O. Brennan, President Obama's senior counterterrorism adviser, said Wednesday," the Washington Post reports.

• "The Obama administration intends to announce an ambitious plan" today "to overhaul the much-criticized way the nation detains immigration violators, trying to transform it from a patchwork of jail and prison cells to what its new chief called a 'truly civil detention system,'" the New York Times reports. "Details are sketchy, and even the first steps will take months or years to complete."

• "Separate roadside bombings in volatile Helmand province today killed at least 26 people, including 21 members of a wedding party and five police officers, Afghan officials said," the Los Angeles Times reports. "Also today, the U.S. military reported the death a day earlier of an American soldier in western Afghanistan. That brought the number of U.S. troops killed so far this month to seven, out of a total of 11 Western military fatalities."

• "Senate leaders Wednesday reached an agreement to limit amendments and debate on extending the 'cash for clunkers' program, setting the stage for a final vote later today," CongressDailyAM(subscription) reports. Senate Majority Leader Harry Reid, D-Nev., "made the unanimous consent request late Wednesday night. It should enable the Senate to finish its work tonight on the House-passed $2 billion extension for the program."

• "Oil traded little changed in New York after rising equity markets pushed prices to a five-week high while a report showed crude inventories swelled in the U.S., the world's largest energy user," Bloomberg reports.

Lobbying: White House Backs Drug Industry

• "Pressed by industry lobbyists, White House officials on Wednesday assured drug makers that the administration stood by a behind-the-scenes deal to block any Congressional effort to extract cost savings from them beyond an agreed-upon $80 billion," the New York Times reports. "Drug industry lobbyists reacted with alarm this week to a House health care overhaul measure that would allow the government to negotiate drug prices and demand additional rebates from drug manufacturers."

• "Small boutique lobbying firms are thriving in an otherwise mixed year for K Street by promising to deliver more bang-for-the-buck than marquee houses," The Hill reports. "Revenues at some of Washington's biggest lobbying firms have been falling as companies and trade groups look to cut costs during the recession. Eight of the 10 firms that booked the biggest earnings in the first half of 2008 saw hefty declines in the first half of 2009 -- some as high as 18 percent."

• "A lingering presidential veto threat and differences between the House and Senate over funding two engines for the Pentagon's next generation fighter jet have awakened a sleeping giant -- General Electric," Politico reports. "General Electric, the nation's fifth-largest company, has already spent nearly $12 million on lobbying this year, according to the Center for Responsive Politics, and is girding for battle this summer, targeting senators who voted against the GE engine."

• "A Justice Department official who briefly worked as a corporate lobbyist has emerged as the leading candidate for U.S. attorney in Alexandria, one of the nation's most prominent law enforcement posts, sources familiar with the selection process said Wednesday," the Washington Post reports.

• "A former lobbyist for Pakistan has been hired by the State Department to coordinate aid to that country, which may highlight loopholes in the administration's tough new lobbying rules, designed to slow Washington's revolving door," The Hill reports.

Technology: FTC Evaluates Online Privacy And Security

• "Regulators are rethinking their approach to online privacy and security, asking academics, public interest groups and industry to suggest ways to overhaul rules to better protect consumers," the Wall Street Journal reports. "As part of the review, David Vladeck, the Federal Trade Commission's new head of consumer protection, is considering whether to throw out current privacy protections that revolve around lengthy disclosure statements that consumers rarely read. What's unclear is what the FTC would propose instead."

Transportation: $2 Billion Awarded To Make Electric Car Batteries

• "Seeking to put the nation back in the lead on an important technology, the Obama administration awarded more than $2 billion in grants on Wednesday for manufacturing advanced batteries and other components for electric cars," the New York Times reports. "The president and four members of his cabinet fanned out across the nation's industrial heartland, hit hard by the recession, to announce the grants, meant to help companies bolster large-scale manufacturing lines for modern batteries of the sort now mostly made in Asia."

• "Federal Aviation Administration chief Randy Babbitt, in his most detailed comments yet about combating pilot fatigue, vowed to tailor future regulations to better reflect the safety challenges facing commuter pilots," the Wall Street Journal reports. "In a speech to the country's largest commercial-pilot union, the agency's administrator said the current 'one size fits all' regulations don't adequately take into account fatigue typically experienced by commuter pilots, some of whom fly five or more segments per day."